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Third Former Mastro Auctions Rep Sentenced

A third member of the now defunct Mastro Auctions team has been sentenced for his role in a long-running shill bid scheme.

Mark Theotikos, 55, was sentenced to 12 months and one day in federal prison on Tuesday. His former bosses, Bill Mastro and Doug Allen, are already serving time. Last week, attorneys for Theotikos had asked for probation while U. S. Attorney Zachary Fardon who has been prosecuting the case, asked Judge Ronald Guzman to sentence Theotikos to 15 months in prison, a term less than the standard guidelines in such cases.

From 2002 to 2008, Theotikos worked for Mastro, where he participated in auction operations at a salary of about $100,000 per year. Prosecutors say Theotikos took direction from his bosses, driving up the prices of items on behalf of certain consignors by placing bids through house accounts. From 2007-2009 alone, investigators believe Mastro, Allen and Theotikos drove up bids on items by nearly $1 million. They stressed the actual amount of phony bids was likely higher since bidding records prior to 2007 were destroyed on Bill Mastro’s orders.

In a pre-sentence memorandum in Theotikos’ case, Fardon cited a 2007 auction in which shill bids were placed on two unopened early 1970s Topps baseball vending boxes, pushing the selling prices far higher than they would have otherwise been. The boxes sold for nearly $14,000 combined when the winning bidders should have actually paid a total of about $3,300.

Mark Theotikos

When some of the shill bids placed in that same sale and ultimately “won”, the items were returned to consignors as unsold. Prosecutors say nine items were sent back to two different sellers following the December 2007 auction alone. Mastro’s group then reported some of those as legitimate sales, when in fact they were not.

The Mastro trio also failed to disclose that over 1,000 items that were owned by the company when they were placed up for auction between April 2008 and February 2009. Those items had ceiling bids which were used to competitively bid against legitimate bidders who were unaware of what was happening.

“This entire seven-year scheme was driven by lies and cheated (or attempted to cheat) many bidders out of money,” Fardon wrote in his memorandum on Theotikos. “And, regardless of the amount, using his position as an insider and executive at the company to cheat bidders and fraudulently drive up auction prices is a serious offense.”

While admitting Theotikos was largely following the orders of his bosses rather than orchestrating the scheme, Fardon noted Theotikos “opted to take a hands-on role to promote shill bidding, rather than demand change or at least leave the company and find a new position.”

Fardon noted that while Theotikos “has largely removed himself from the industry and seems unlikely to commit additional crimes, the need for general deterrent is significant.” He called what happened “a crime of opportunity.”

Theotikos, who has no prior criminal history, had received letters of support from family and friends as well as others in the sports memorabilia industry. He also wrote a letter to Judge Guzman apologizing for his actions.

“By shill bidding, I artificially raised prices of those items while creating a ripple effect throughout the entire market. In an industry which over the years has been looked at with suspicion and where customers can only rely on the auction house being reputable, I realize I have breached the trust of not only the Mastro Auction customers, but the sports memorabilia industry as a whole,” he wrote.

“Looking back, I realize that I put myself in front of doing what was right. Although I raised objections on occasion, I should have been more forceful in my protestations. I had a management title but I did not assert myself or take responsibility for what was happening.”

In his request for the 15-month term, Fardon also fired a warning shot to other auction houses who might believe they would escape the reaches of federal law enforcement.

“For others in the auction industry with authority similar to defendant, a 15 month sentence will make clear that if law enforcement puts in the time and effort necessary to prove up shill bidding – the court will meet the conduct with a significant consequence.” Ultimately, Judge Guzman believed 12 months was a sufficient penalty. Theotikos could serve a little less than that for good behavior.

Theotikos, who joined Allen at Legendary Auctions after Mastro folded, is married with two children. He says he is now unemployed and was contrite in his correspondence with the judge.

“I cannot change what has happened in the past, but I can change the future,” he wrote. “I do not want this to be my legacy and I aim to use my remaining years to make a life that my daughters, wife, and family can be proud of.”

Legendary Auctions closed in August of last year.

Mastro is currently serving a 20-month sentence at the federal prison camp in Pekin, IL while Allen will likely serve less than five years of a 57-month sentence. Last year, former Mastro IT Director Bill Boehm received probation for making false statements to federal investigators who interviewed him.

Theotikos is scheduled to enter the federal prison system on August 1, likely at a minimum security camp similar to those that house Mastro and Allen.

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About Rich Mueller

Rich is the editor and founder of Sports Collectors Daily. A broadcaster and writer for more than 30 years and a collector for even longer than that, he's usually typing something somewhere. Type him back at [email protected]